YouTube tops 100MM viewers in January. So what?

This morning I read a MarketingVOX article highlighting how YouTube just surpassed 100MM viewers in January. That’s great news for video commerce, right? It’s all fine and good that YouTube has such a vast audience, but the more pertinent question for video commerce professionals is: should you care, and if so, why?

Unfortunately, I think this is one question that hasn’t really been adequately examined by many video commerce professionals, and like many questions worthy of examination, the answer isn’t always clear cut. So let’s take a critical look at YouTube’s role in the video commerce ecosystem and outline the potential benefits and drawbacks around YouTube for video commerce. I really want people to throw counter arguments to some of these statements… please, tell me if I’m wrong.

First, some of the benefits:

1. Audience. For brand building, viral video, and awareness-oriented video, no video platform tops YouTube’s audience. It’s still a garden rich with opportunity for marketers centered on achieving these goals. The question I’d pose to video commerce professionals is this: are these in fact your goals? E-commerce merchants sell products. Brand marketers build audience. There is a difference. Unless you can clearly correlate increased views or impressions with sales, what’s the point?

2. Cost. Anyone can publish video to YouTube, for free. YouTube hosts content, for free. YouTube even lets you launch a channel, for free. Of course, nothing is ever *truly* free, but still, this is a huge plus in the YouTube column, especially during the protracted recession. The most powerful word in marketing is still F-R-E-E. Go YouTube.

3. Tools. YouTube has come a long way in the tools area over the last year. The site now offers more capability for integrating a custom video player on your site through their new API (although functionality is still pretty limited). Plus, the service now supports high definition video – a major leap forward in quality. The community features on YouTube aren’t half bad, either. YouTube is actually launching a program to share some of its lesser known features with the broader YouTube community. I expect we’ll continue to see YouTube focus on improving the quality of its tools.

4. Great Source of Content. Are you looking for product videos? Aside from perhaps ExpoTV, there’s not another video sharing service that comes even close to YouTube in terms of possessing such a wide variety of product video content – and, perhaps contrary to popular belief, not all the content is UGC. Many brand marketers and product manufacturers post their videos to YouTube. It’s a treasure trove of video content, much of which you can use to rapidly fatten the library of videos used in your video commerce program – provided you’ve got systems and processes in place to make it scale well.

Now, we’ll focus on some of the drawbacks.

1. Ads. YouTube calls their new ad overlays part of their evolving “e-commerce” program, but don’t be confused – YouTube isn’t thinking of e-commerce in the way you or I might. They’re thinking of advertising. Recent reports show 25% of Google searches occur on YouTube, and YouTube is interested in selling ads and extending Google’s reach into YouTube. How excited are you about having your video running with a competitor’s text ad overlaid on top?

2. Loss of control. Even with a custom player, YouTube forces the display of related videos at the close of each video. Remember YouTube’s goal is to drive eyeballs, not sell with video. Which means that related videos could feature videos completely unrelated to shopping on your site – or worse – drive people to videos featuring ad overlays from your competitors, or worse still – directly to your competitor’s videos.

3. Limited functionality. E-commerce merchants are about selling products, so it’s only natural to look for video technology that helps accomplish this aim. Want to merchandise your products or other e-commerce videos in a YouTube video? Forget it. Publish your videos to other syndicated video services? That’s not in YouTube’s interest – strike two. How about integrate videos into your affiliate or email programs? Nope. How about engagement tracking, web analytics integration, and other sophisticated reporting? You’ll get little to nothing in that department, too (though I suspect YouTube will continue improving in this area).

4. YouTube channels. I have to crack a slight grin when retailers tell me about their great YouTube channels. Truth be told, I have yet to meet someone who could give me a *really* straight answer about how well their channels actually perform – and it’s no wonder. YouTube Channels not only are built with 1998-esque tools with limited potential for custom branding (even in the branded channels), but even with the best SEO in the world, these channels don’t move people to product pages through the videos. If you think this is just an ‘oversight in functionality’ on YouTube’s part, you’d be wrong. Remember, YouTube is about advertising. They want to power millions of TV channels so THEY can sell advertising in the videos.

Do you think this online retailer is proud of the customer experience they are delivering through their YouTube Channel? You be the judge.

All this brings be back to Point #1. Most online retailers are not interested in monetizing videos through ads – with a few notable exceptions. In today’s video commerce industry, the videos themselves are the ads. The purpose of the videos is to drive traffic to e-commerce sites and generate sales.

In today’s video commerce industry, the videos themselves are the ads. The purpose of the videos is to drive traffic to e-commerce sites and generate sales.

What do you think? Has this post adequately represented the main benefits and drawbacks of YouTube for video commerce? Please let me know your thoughts – and, as always…

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Justin Foster

Justin is Co-Founder and VP Market Development of RealTime Email at Liveclicker. Prior to Liveclicker, Justin led the services practice for WhatCounts, Inc., an email marketing services provider, where he was responsible for client strategy and deliverability. He also founded the Email Marketing Roundtable, an industry discussion forum that represents over 1,500 email marketers worldwide including the majority of the largest online retailers in North America.